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As the Arizona budget continues to increase, legislators have been busy finding ways to further diminish the general fund. Several bills are making their way through the legislature under the guise of private school tax credit reform that would drastically increase the amount of the tax credit deductions for private school tuition.
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One proposal triples the deduction for private school tax credits to $1,500 for individuals and $3,000 to those filing jointly. The Arizona Republic reports that “[ t]he average tax owed by an Arizona resident in 2008 was $1,150.” There is no doubt that this legislation would have a profound impact on the Arizona budget deficit.
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At the same time, the Governor’s budget is proposing the elimination of state funding for Adult Education and GEDs. According to the National Center for Educational Statistics, Arizona has a drop out rate of 7.6%. Moreover, nationally, the NCES has shown that high school drop outs are disproportionately poor Americans. In 2006, the drop out rate for all incomes was 3.8% while the drop out rate for those in the bottom 20% of family incomes was 9.0%.
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Considering these factors, the elimination of funding for adult education programs that helps Arizona’s poor work toward a GED seems economically unsound. Without these programs, which channel Arizona drop-outs to higher education and better jobs, it seems likely that there will be more Arizonans on AHCCCS and possibly even larger prison populations – greatly increasing costs to Arizona taxpayers.
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The following is a list of related bills in the legislature that seek to increase tax credits and reduce general fund revenues. For further information on both these topics, see the related news links below.
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HB 2496 School Tuition Tax Credit; Contribution Date: Allows a donation made to a school tuition organization (STO) between the close of the tax year and the income tax return filing deadline to be applied to either the current or preceding tax year for the purpose of claiming an income tax credit.
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Status: On the February 8th agenda for the House Ways and Means Committee..
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SB 1274 STOs; Contribution Date: [Senate version of HB 2496 ]
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Status: Passed out of Senate Committee on Education Accountability and Reform on Wednesday, February 3rd.
View Senate committee vote detail by clicking here.
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HB 2663 STOs; Corporate Tax Credit Requirements:Reorganizes the current provisions regulating school tuition organizations (STOs) that accept corporate income tax credit donations and implements additional regulatory measures for STOs based on the recommendations of the Ad Hoc Committee on Private School Tuition Tax Credit Review.
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Status: On the February 8th agenda for the House Ways and Means Committee.
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HB 2664 STO; Tax Credit Requirements:Increases the maximum private school tax credit contributions to an STO from $500 to $750 for a single or head of household taxpayer and from $1,000 to $1,500 for married couples filing joint; and adjusts the maximum individual tax credit amounts annually for inflation, but prohibits the amounts from being adjusted below the amounts for the prior taxable year.
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Status: On the February 8th agenda for the House Ways and Means Committee.
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**Note: AEN is tracking down details on bills scheduled for February 8th’s House Ways and Means Committee. Specifics of bills will be updated as information becomes available.
Related News:
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Cutting GED money will ‘cut our dreams’, Arizona Daily Star, February 5, 2010
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Arizona lawmakers consider tax-credit overhaul, Arizona Republic, February 4, 2010
Rigged Priviledge: An investigation into Arizona’s Private School Tax Credits Program, East Valley Tribune, August 1, 2009
Governor Brewer proposes to slash funds for all adult ed. protesters ready to rally, KOLD-13, February 4, 2010
Economic and Non-Economic Outcomes for GED Credential Recipients, General Educational Development Testing Service of the American Council on Education, 2008
High School Dropout and Completion Rates in the United States: 2007, U.S. Department of Education, September 2009
Tags: Adult Education, Arizona Adult education, Arizona budget, arizona education, Arizona GED, Arizona tax credit, GED, School Tuition Organization, STO, tuition tax credit
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